If you are moving from SAP ERP Payroll on-premise to SAP SuccessFactors Employee Central Payroll (ECP), there are two migration options: Lift and Shift and Rip and Replace.
One might make more sense than the other, and there are benefits to both.
Lift and Shift
Lift and shift is a like-for-like migration of SAP Payroll on-premise to ECP in the cloud. Your payroll rules, configurations, and data will be carried over, and there will be no rebuild or redesign of the system. There are partner tools that enable Lift and Shift to happen without reconfiguration.
Within lift and shift, there is also the “lift and shift and adjust” possibility that allows you to run parallels to ensure the migration is successful. Once that’s done, you can start making adjustments to the configuration. Choose this option if you want to have payroll history but also make changes.
Rip and Replace
This is a wholly new payroll implementation. It’s rethinking everything—including fundamental configurations—from the ground up when moving from SAP Payroll on-premise to ECP.
Choosing Lift and Shift or Rip and Replace
Most companies choose Lift and Shift vs. Rip and Replace.
This is because payroll works fine and the thought of disrupting payroll is considered too great a risk weighed against any potential benefits of reconfiguration.
Lift and shift allows an organization to keep its history and the ability to make retroactive payroll actions—salary changes that may come out of collective bargaining, for example. A like-to-like migration from SAP Payroll on-premise to ECP is also the quickest and cheapest route to the cloud.
Why choose rip and replace? If a company isn’t happy with how their payroll operates. There may be legacy configurations and add-ons that are unmanageable, or the people that managed them left the company.
Companies may also want to unify systems that came from mergers and acquisitions, where it doesn’t make sense to keep leftover payroll rules.
The Bottom Line
If your payroll works for you, lift and shift could get you to cloud payroll sooner.
If you have a need for change, rip and replace may be the best path to Employee Central Payroll.
If you are in between, look at the “lift and shift and adjust” option.
Why Move to the Cloud for Payroll, Anyway?
If lift and shift makes sense because your SAP payroll on-premise system works, then why migrate to ECP?
There are the standard benefits of cloud – less need for internal maintenance resources, support packs, system administration, technical updates, and managing hardware are no longer required.
Beyond that, there are benefits in ECP over SAP Payroll on-premise. SAP releases new features in Employee Central Payroll on a biannual release schedule, so you are likely to gain value by migrating over time. This is where SAP is focusing its payroll innovation. You won’t get much in legacy SAP Payroll on-premise beyond patches.
Integration with SuccessFactors
If you also plan to move core HR to SAP SuccessFactors Employee Central, then you’ll find a simplified integration with ECP vs. SAP Payroll on-premise. There are process efficiencies in payroll tasks via the cloud-to-cloud integration.
There’s also Payroll Control Center, which is rare for on-premise customers to implement but the default if you use ECP. Payroll Control Center modernizes your payroll process with a more consumer-grade look and feel.
So, whether you choose lift and shift or rip and replace, there are plenty of reasons for SAP Payroll migration from on-premise to ECP.
Making the Right Call on SAP Payroll Migration
Lift and shift and rip and replace are broad terms—your SAP Payroll migration is likely to have its unique aspects.
Talk with SAP and your implementation partner about the options available. There are partner tools that can make a move easier, but you need to make sure those will work for your organization.
